Stock markets across Asia fell sharply on Friday, with Japan and South Korea suffering the heaviest losses as investors moved to cash out on recent gains tied to the artificial intelligence boom.
U.S. futures also dropped during the session, and oil prices moved lower as well.
Tokyo’s Nikkei 225 dropped 5%, settling at 68,783.50, while Seoul’s Kospi tumbled a dramatic 8.4% to close at 8,182.54. Both indexes had reached all-time highs earlier in the week before Friday’s steep reversal.
Elsewhere in the region, Hong Kong’s Hang Seng index fell 1.9% to 22,644.49, and China’s Shanghai Composite slid 2.1% to 4,032.30. Australia’s S&P/ASX 200 held relatively steady, finishing nearly flat at 8,745.80, while Taiwan’s Taiex gave back 3.3%.
The dramatic swings are consistent with the kind of turbulence markets have been experiencing lately, as investors respond to the enormous flow of money pouring into AI data centers and related ventures.
On Thursday, U.S. markets ended with a mixed result after a rollercoaster session involving several AI-related stocks. Apple shares dropped 6.1% after the company announced higher prices on many of its products.
The S&P 500 closed virtually flat, slipping less than 0.1% after bouncing between gains and losses throughout the trading day. The Dow Jones Industrial Average added 71 points, a gain of 0.1%, while the Nasdaq composite dipped 0.5%.
One bright spot was Micron Technology, whose shares surged 15.7% after the computer memory manufacturer reported quarterly profits and revenues that far exceeded analyst expectations. The company also issued a stronger growth outlook for the current quarter than Wall Street had anticipated, helping ease concerns that its stock — which had already climbed 267% on the year heading into Thursday — had become overvalued.
Micron and other AI-related stocks have faced intermittent pressure in recent weeks over fears that their earnings growth cannot keep up with the massive run-ups in their share prices. Separately, chipmaker Qualcomm announced late Wednesday that the rapid advancement of the AI era is pushing the company to raise its own growth projections for the coming years.
SpaceX shares, meanwhile, slipped 1%, dropping below $153 to mark their lowest closing price since the company made its much-anticipated debut on the Nasdaq earlier this month.
A new inflation report showed price increases are tracking roughly in line with what economists had predicted, with inflation rising to 4.1% last month compared to 3.8% in April. Analysts are hopeful that a recent decline in oil prices could help bring inflation down further.
The international oil benchmark, Brent crude, fell 1.8% to $74.13 per barrel in early Friday trading. Prices have retreated from highs above $100 that were driven by the closure of the Strait of Hormuz during the Iran war, which disrupted the global flow of oil. U.S. benchmark crude dropped 2% to $70.46 per barrel.
In currency markets, the U.S. dollar eased to 161.64 Japanese yen from 161.80 yen, while the euro climbed slightly to $1.1376 from $1.1371.
